Hindi movie DVDs at Rs 38, VCD at 24

MUMBAI: In one stroke, Optical disk manufacturer Moser Baer has destroyed the business model of pirated movie seller and even the DVD libraries across the country. Delhi based optical disk maker is going to launch Hindi movies on DVD at Rs 38 and VCD at Rs 24.

The price of a Hindi DVD at the retail end varies from Rs 200 to Rs 400 and even higher if it's a new release. Moser Baer's comparable price is one tenth of the existing retail price for these disks. The MRPs for Moser Baer movies will be even lower than rentals from libraries or buying pirated DVDs or VCDs.

Moser Baer has developed new technology to bring the price down for the Digital Video Discs (DVDs) and Video Compact Disks. "We have filed for more than 30 technology patents to develop these new discs, and they use a new compound and proprietary technology to copy the content on the disk at the manufacturing stage. This has helped us bring down the cost, substantially," said, Ratul Puri, Executive Director of Moser Baer.

Moser Baer is going to buy home video and DVD/VCD rights and distribute them across retail stores in the country. The company has started an entertainment division to sell and distribute these movies across the country.

The entertainment division is in the final stages of negotiating with production house to acquire copyrights or exclusive license for around 7,000 titles in all major Indian languages. "We want to acquire 40% of all the movie content produced in India in the coming years," said Harish Dayani, CEO of Moser Baer's Entertainment division. Mr. Dayani was earlier with Saregama-HMV, as head of the music business, he joined Moser Baer six months back to spearhead the new division.

Taking the price factor into account, the company is hopeful that it will be able to reach out to a much larger retail network." We are looking at this product as an FMCG product, so it should be available at even a Kirana or paan shop," Ratul Puri, says.

"Even video libraries are a potential distribution channel as they need not rent out DVD. The financial model can change to selling the movies to the customer, as they will make more money out of it," Yograj Mathur CFO of Moser Baer says.

The copyright home video market in India is around Rs 200 crore, while the pirated market is Rs 20,000 crores, according to entertainment industry estimates. Moser Baer's MRP is low, but the margin to the distributor will be comparable to a FMCG product.

Moser Baer has priced its products so that it lower than the price of two recordable VCDs or even one recordable DVD. This means that there is no margin left for a pirate, who would generally buy recordable disks and copy content on it to sell them. A pirated DVDs can sell for anywhere between Rs 70 to Rs 100 and a pirated VCDs for Rs 30 to Rs 45.